Friday, August 22, 2008

Fantastic article from the August 18 issue of "Investor's Business Daily":

Barack Obama's economic blueprint sounds like one his communist father tried to foist on Kenya 40 years ago, with massive taxes and succor shrouded as "investments."

As a Nairobi bureaucrat, Barack Hussein Obama Sr. advised the pro-Western Kenyan government there to "redistribute" income through higher taxes. He also demonized corporations and called for massive government "investment" in social programs.

Barack Obama Sr., who died in 1982 at age 46 in a Kenya car crash. Writing in a 1965 scholarly paper, Obama's late father slammed the administration of then-President Jomo Kenyatta for moving the Third World country away from socialism toward capitalism. He chafed at the idea of relying on private investors — who earn "dividends" on their venture capital — to develop the country's fledgling economy.

"What is more important is to find means by which we can redistribute our economic gains to the benefit of all," said the senior Obama, a Harvard-educated economist. "This is the government's obligation." The "means" he had in mind were confiscatory taxes on a scale that redefines the term "progressive taxation."

"Theoretically," he wrote, "there is nothing that can stop the government from taxing 100% of income so long as the people get benefits from the government commensurate with their income which is taxed."

Therefore, he added, "I do not see why the government cannot tax those who have more and syphon some of these revenues into savings which can be utilized in investment for future development."

As Obama's father saw it, taxes couldn't be high enough, so long as the collective benefited. "Certainly there is no limit to taxation if the benefits derived from public services by society measure up to the cost in taxation which they have to pay," he said. "It is a fallacy to say that there is this limit, and it is a fallacy to rely mainly on individual free enterprise to get the savings."

His son is also pushing massive taxes and "investments" in social programs — at the expense of free enterprise. Sen. Obama wants to raise the top marginal income-tax rate to at least 39%, while increasing Social Security taxes on those with higher incomes by completely removing the payroll cap. That means many entrepreneurs would be paying 12.4% (6.2% on employer and 6.2% on employee) on Social Security payroll taxes alone, plus the 2.9% on Medicare taxes, for a total federal tax rate of 54%.

In addition, Obama wants to jack up the capital-gains tax rate and reinstate the death tax.

Echoing his father, he argues that the government should impose "tax laws that restore some balance to the distribution of the nation's wealth."

And likewise, he asserts that the nation's wealth ought to be rechanneled by government into "investments" in the economy and welfare programs that create "a new American social compact."

"We can only compete if our government makes the investments that give us a fighting chance" in the global economy, the Democrat presidential hopeful said in his 2006 book, "The Audacity of Hope." "And if we know that our families have some net beneath which they cannot fall."

"Training must be expanded," his father proposed as one of his government "investments." Likewise, Sen. Obama wants to "invest" billions more in federal jobs retraining.

His father's critique of Kenya's economic policy was published in the East Africa Journal under the title "Problems Facing Our Socialism." One discovers — after reading just a few pages into his eight-page tract, where he waxes quixotic about "communal ownership of major means of production" — that he wasn't criticizing the government for being too socialistic, but not socialistic enough.

Obama Sr. described his own economic plan, his counterproposal, as it were, as "scientific socialism — inter alia — communism." Yes, Obama's father was a communist who wanted to put socialist theory into action — by "force."

He trusted the collective over the individual, a theme he successfully instilled in his son, also Harvard-educated, with whom he visited once for a full month in Hawaii, even speaking to his prep school class. He kept up correspondence with his son through his college years.

(Media accounts portray Obama's father as being completely out of his life after leaving his mother and him at age 2. But Obama's first book, "Dreams From My Father," reveals that he remained an influential force in his life. Obama's first autobiography was devoted to "my father.")

Listen to what "the Old Man," as Obama and his siblings called him, wrote in proposing government-run farms: "If left to the individual, consolidation will take a long time to come. We have to look at priorities in terms of what is good for society, and on this basis we may find it necessary to force people to do things they would not do otherwise."

He explained that "the government should restrict the size of farms that can be owned by one individual throughout the country."

More evil than individuals, Obama's father believed, are heads of corporations. More evil still are the bankers and investors, who conspire to control the world through their evil capitalist system."One who has read Marx cannot fail to see that corporations are not only what Marx referred to as the advanced stage of capitalism," he wrote. "But Marx even called it finance capitalism by which a few would control the finances of so many, and through this, have not only economic power but political power as well."

It's clear from Sen. Obama's own writings and speeches that he too is no fan of business or our system of "chaotic and unforgiving capitalism," as he wrote in "Audacity." He's fond of bashing Wall Street "greed" and the post-Reagan rise of individual investing over government investing. He wants to roll back the "Ownership Society." He resents the profit motive and individuals "on the make."

"Rather than vilify the rich," he laments, "we hold them up as role models, and our mythology is steeped in stories of men on the make."

This is no small point. The man who wants to be the nation's CEO actually believes we're living in a feudal society where the rich plunder the poor. And he thinks they should not only be vilified but punished.

"The problems of poverty and racism, the uninsured and the unemployed are rooted in the desire among those at the top of the social ladder to maintain their wealth and status whatever the cost," he wrote. "Solving these problems will require changes in government policy."

That is, massive taxation, among other things (or "inter alia," as his "brilliant" father would say).

Obama wrote in "Dreams From My Father" that he was trying to impress his father by taking a low-paying job organizing and agitating in the Chicago ghetto right out of college. "I did feel that there was something to prove to my father," he said.

Yet, suspiciously, he does not once mention his father's communist leanings in an entire book dedicated to his memory. No doubt he wanted to keep that hidden. All he tells readers is that his father was pushed out of the Kenyatta administration. He does not explain why.

"Word got back to Kenyatta that the Old Man was a troublemaker and he was called in to see the president," Obama wrote, quoting his half-sister, "because he could not keep his mouth shut." About what, we aren't told.

However, Obama writes sympathetically of a comrade of his father, Oginga Odinga, who stepped down as vice president and tried to start his own party. He too was angry that President Kenyatta was letting private investors buy up businesses and land "that should be redistributed to the people," Obama said.

By 1967, two years after Obama Sr. penned his paper, Odinga had been placed under house arrest for holding a rally that turned into a riot.

Like Obama's father, Odinga was a member of the Luo tribe of Kenya. His son, Raila Odinga, ran for president in 2006. That year, Obama traveled to Kenya and appeared with Odinga at rallies where he criticized the pro-U.S. government Odinga wanted to oust.

When he lost the election the next year, despite Obama's tacit endorsement, angry Odinga supporters crying fraud sparked riots that resulted in some 1,500 deaths. Amid his ancestral country's civil unrest, Obama took time out from the campaign trail to phone Odinga to voice his support.

After weeks of violence, Odinga was granted a power-sharing deal. He's now acting prime minister.

He's also a something of a communist like his father. An East German-trained engineer, he named his oldest son after Fidel Castro. Paralleling him, Sen. Obama wants to open dialogue with Cuba and once proposed lifting the trade embargo.

The two sons have much in common. However, the son who would lead the U.S. learned from his father's mistakes and keeps his "mouth shut." Obama learned that revealing his real beliefs can jeopardize his quest for the power needed to put his "redistribution" plans into action.

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